Duqm refinery work to start by year-end

Ground work for the Duqm refinery will begin by the end of the year and be ready by 2021 and the Oman Oil Company is doing `a great job’ to overcome technical and financial challenges, according to Undersecretary at the Ministry of Oil and Gas HE Eng Salim Al Aufi.

It was one of the biggest challenges for OCC to complete the refinery and related projects, meeting financial and technical needs, he said on Tuesday during the second Oman Downstream Exhibition and Conference.

The refinery project includes process units, utilities and offsite facilities such product storage and export terminal, crude storage tanks in Ras Markaz and an 80km crude pipeline from there to the refinery complex.

The refinery cannot be built without these supporting facilities, including a gas pipeline. “All these projects will have to go hand-in-hand, which is the biggest challenge OOC is facing, that is, how it can find finance for all of these projects at the same time. They are doing a great job trying to strike excellent deals on the technical or financial side. All the projects are promising commercially, that is a no brainer. It is just a matter of finding capacity to execute all these projects at the same time,” he added.

The shareholders agreement for the 230,000-bpd refinery that could be expanded and estimated to cost $7 billion will be signed between OOC and and Kuwait Petroleum International on April 10.

Feedstock would be 35 per cent Oman crude and the rest from Kuwait, said Al Aufi.

Oman Oil Refineries and Petroleum Industries Company (Orpic) CEO Ahmed Al Jahdahmi said developing marketing skills was a new challenge not only for Orpic but also for the Sultanate. The Sohar Refinery Improvement Project would increase production of fuels, naphtha and propylene by 70 per cent. The company was in the process of setting up offices in key markets for selling polymers.

Al Jahdahmi said it was continuing to recruit around 200 persons every year,’till we grow to 3,000 employees by 2020’.

Tanfeedh could result in new downstream industries but Orpic had an international customer base and sold wherever its products were in demand.